Chelsea Council to vote Tuesday on sewer agreement

Chelsea Council votes to purchase sewer system

Chelsea residents at a July 2018 City Council meeting, where council members voted to attempt to purchase the city sewer system from SouthWest Water Company.

After months of private negotiations, the Chelsea City Council will vote on a new sewer rate agreement with SouthWest Water Company at its Jan. 22 meeting, according to a press release from Mayor Tony Picklesimer.

As SouthWest was not interested in selling the system, last summer's council discussions also included the possibility of using eminent domain to acquire the system. Picklesimer has said in previous interviews that he believes the sewer rates in the city have hurt Chelsea's growth, particularly in attracting new businesses.

Today's press release, however, showed that the city intends to try to work with SouthWest going forward.

The proposal would freeze utility rates for Shelby Ridge customers through January 2021 and will "limit future adjustments of the SRUS monthly fees and reservation fees to reasonable parameters," the release said. Rates will be reviewed annually and SouthWest must use the Alabama Public Service Commission's return on equity calculation to support the need for future rate adjustments.

The Public Service Commission does not regulate private sewer systems like Shelby Ridge.

Picklesimer said via email that he would not disclose specifics from the agreement, such as the parameters for rate increases, until the vote.

According to the press release, reservation fees will be reduced for certain types of future businesses. Reservation fees are required for new connections to the sewer system. Lateral service line extension fees will be eliminated for businesses, up to 100 feet, the release stated.

“By entering into the settlement agreement with SRUS, the City of Chelsea will be able to secure our objectives of ensuring the provision of cost-effective utility services for Chelsea’s citizens and making Chelsea more attractive to incoming commercial or industrial customers,” Picklesimer said in the release.

The Chelsea City Council meeting will be held at City Hall at 6 p.m., with a pre-council meeting beforehand. Representatives of the sewer system will be present for the vote.